Abstract
Self-employment accounts for a large share of female employment in most developing countries, and it is considered an important avenue for women's economic empowerment. However, the majority of female-owned enterprises are small in scale with commensurately low earning levels.
Researchers from the World Bank, University of Peradeniya, and Warwick University designed an impact evaluation study to investigate the effectiveness of business training to increase female labor force participation and to raise the income levels of low-earning women already in business in Sri Lanka.
The International Labor Organization's Start-and-Improve Your Business (SIYB) program is one of the most common training courses in developing countries. This program has been given to over 4.5 million people in more than 95 countries.
In Sri Lanka, using a randomized design, researchers tested whether the impact of SIYB training alone differed from the training combined with access to capital in the form of a grant. Two samples were chosen. The first sample consisted of 624 women operating a business and earning an income of less than $2 per day. The second sample consisted of 628 women who were out of the labor force at baseline, but who expressed interest in starting a business within the next year. The first sample was referred to as "current business owners" and the second - as "potential business owners." Each sample was randomized into three groups: a control group, a group invited to attend training, and a group invited to receive the training and a grant of $129, conditional on completing the training.
A baseline survey was conducted in January 2009. Training took place in April and May 2009, and the cash grants were distributed in June 2009. Four rounds of follow-up surveys were carried out in September 2009, January 2010, September 2010, and June 2011 (rounds 2, 3, 4 and 5 respectively). The follow-up surveys asked detailed information about business outcomes, including the key performance measures of business profits in the last month, sales in the last month, and capital stock (including raw materials and inventories).
Unit of Analysis
1) Female current business owners.
This group consisted of self-employed women who worked more than 20 hours per week in self-employment, were involved in a sector other than seasonal agriculture or fisheries, and had monthly profits of 5000 Rs or less (the median in the general population of female self-employed).
2) Female potential business owners.
This group consisted of women who were out of the labor force, but who were likely to enter the labor force within the next year. For females out of the labor force and between 25 and 45 years of age, the screening survey asked directly whether the woman planned to enter self-employment in the next year, as well as the nature of the business that she planned to start. As a signal of seriousness of intent, researchers sampled only women who were able to identify the type of business that they planned to start. Since the ability to participate in full-day business training program was important for the proposed intervention, respondents were also asked about the availability of child care for any children younger than five years of age.
